Target has announced that it has agreed to a $67 million settlement with Visa over the huge security breach that occurred in 2013.
The US retailer was accused of failing to address concerns from its security partners in the lead up to hackers acquiring sensitive information relating to 40 million credit and debit cards.
Banks and other firms that issued affected Visa cards will use the payout from Target to cover the cost of sending replacement cards and dealing with the any cases of fraud against their customers. However, the settlement does not draw a line under the data breach scandal.
Target is attempting to agree a similar deal with MasterCard, after the financial services firm rejected its $19 million compensation offer. In addition, the retailer has also pledged $10 million to customers affected by the hack, with recent court documents suggesting that each individual could receive as much as $10,000.
Target is far from the only retailer to fall foul of cybercriminals and Home Depot suffered a similar breach to its payment systems across more than 2,000 stores in 2014. Industry experts have estimated the cost of the two high-profile data hacks to community banks and credit unions at more than $350 million.
Given the huge costs involved, some have criticised the level of compensation being offered by Target and, indeed, Visa for accepting. Smaller card issuers that are continuing their own lawsuits against Target believe that the $67 million will not cover their losses. However, the Wall Street Journal understands that the figure was the maximum that Visa could accept under its own regulations.
Despite taking place two years ago, the fallout from the Target data breach looks set to continue. Although financial settlements are now being finalised, hacks such as this one often cause emotional damage to customers that is less easily rectified.